Ex-IBM Exec Moffat May Plead Guilty in Insider Trading Case

Robert Moffat, at one time a senior vice president and group executive for IBM's hardware business, may plead guilty March 30 for his role in an insider trading scandal that netted more than $25 million in illegal gains. Moffat, who waived indictment, would be the 11th person to plead guilty in a case that also saw an Intel official arrested.

Robert Moffat, the former high-ranking IBM executive charged in a
wide-ranging insider trading scheme, appears ready to plead guilty,
possibly as soon as March 30.

According to reports and court documents, Moffat, who
at one time was seen as a possible successor to current IBM CEO Sam
Palmisano, has waived his right to an indictment, a move the usually
precedes a guilty plea.

He reportedly is due in U.S. District Court in New York City March 30 for a hearing on the indictment waiver.

Moffat faces a host of charges that include
securities fraud and insider trading. He was one of almost two dozen
people arrested in the case, which was characterized by federal
government's use of wiretaps that are commonly seen in organized crime
cases.

Federal prosecutors say the insider trading scheme netted more than $25 million in illegal gains.

In Moffat's case, he allegedly was caught on tape in
2008 talking with Danielle Chiesi, at the time a portfolio manager with
hedge fund New Castle Funds and a personal friend, about chip maker's
Advanced Micro Devices' plans to spin off its manufacturing business.
AMD eventually did spin off the business, creating Globalfoundries.

At the time, Moffat was senior vice president and
group executive of the company's $20 billion Systems and Technology
Group. He was arrested in October, along with Chiesi and a number of
other people connected with Wall Street and the technology industry.

Others charged include Rajiv Goel, an executive with
Intel's treasury group; Anil Kumar, a director at McKinsey & Co.;
Raj Rajaratnam, founder and managing partner of hedge fund Galleon
Management; and Mark Kurland, a senior managing director and general
partner at New Castle. New Castle Funds and Galleon Management also
were named in the complaint in October.

Almost a dozen people have pleaded guilty in connection with the case, including Goel and Kurland. Goel no longer is an Intel employee, according to the company.

Though not charged, former
AMD CEO Hector Ruiz also has been tainted by the case. In the wiretaps,
Chiesi is said to be talking about an unnamed AMD executive who also
was giving her information. Several publications, citing unnamed
sources, said Ruiz was that executive.

Soon after the reports came out, Ruiz resigned as chairman of Globalfoundries.